Economist Laura Baughman of the Trade Partnership has issued an Updated Policy Brief on the estimated impacts of the Section 232 steel and aluminum tariffs. This includes almost 13,000 job losses in the category of Fabricated Metal Products.
This version, dated June 5, does two things:
(1) It reflects the current state of play of the tariffs: applicable to everyone, including the European Union countries, Canada and Mexico, except those who have swapped tariffs for quotas (Korea, Argentina and Brazil). (In short, only Australia, it seems, has escaped tariffs and quotas). It also reflects retaliation from all the countries subject to tariffs, with as much of the detail captured as possible.
(2) The employment assumption reflects tighter labor markets. This means that when a worker loses a job, he/she has an easier time finding a new job in the short run (1-3 years), so there is less unemployment from the tariffs during that period. This explains why jobs estimates here are not as large as you may be expecting.
The report indicates:
- The tariffs, quotas and retaliation would reduce US GDP by 0.2 percent annually, in the short term. While US imports would decline, so, too, would US exports.
- The tariffs, quotas and retaliation would increase the annual level of US steel employment and non-ferrous metals (primarily aluminum) employment by 26,280 jobs over the first one-three years, but reduce net employment by 432,747 jobs throughout the rest of the economy, for a total net loss of 400,445 jobs;
- Sixteen jobs would be lost for every steel/aluminum job gained;
- More than two thirds of the lost jobs would affect workers in production and low-skill jobs.
- Every state will experience a net loss of jobs.
AWPA members are encouraged to provide this brief to your Members of Congress!